Discretionary Spending

Multiple Budget Functions

Reduce the Annual Across-the-Board Adjustment for Federal Civilian Employees' Pay

CBO periodically issues a compendium of policy options (called Options for Reducing the Deficit) covering a broad range of issues, as well as separate reports that include options for changing federal tax and spending policies in particular areas. This option appears in one of those publications. The options are derived from many sources and reflect a range of possibilities. For each option, CBO presents an estimate of its effects on the budget but makes no recommendations. Inclusion or exclusion of any particular option does not imply an endorsement or rejection by CBO.

Billions of dollars 2015 2016 2017 2018 2019 2020 2021 2022 2023 2024 2015-2019 2015-2024
Change in Spending                        
  Budget authority 0 -0.8 -1.9 -3.1 -4.4 -5.7 -7.2 -8.7 -10.3 -12.0 -10.2 -54.0
  Outlays 0 -0.8 -1.9 -3.1 -4.3 -5.7 -7.1 -8.6 -10.2 -11.9 -10.0 -53.6

Note: This option would take effect in January 2016. Estimates are relative to CBO’s August 2014 baseline projections. About one-fifth of the savings would be reductions in intragovernmental payments and thus would not reduce the deficit.

Under the Federal Employees Pay Comparability Act of 1990, most federal civilian employees receive a pay adjustment each January. As specified by that law, the size of the adjustment is set at the annual rate of increase of the employment cost index (ECI) for wages and salaries in private industry minus 0.5 percentage points. Under this option, the annual across-the-board increase would be reduced by 0.5 percentage points each year from fiscal year 2016 through 2024.